The U.S. economy is currently in its second-longest expansion on record and unemployment is at historic lows. Yet despite robust growth at the national level, some areas are still struggling. The variation in economic vitality across America has reignited a debate: Should government programs help people, or should they help places?

There has always been variation in economic prosperity across the country. The figure below, from another Brookings study by Ryan Nunn, Jana Parsons, and Jay Shambaugh, shows that’s still the case today. They created an index that captures the economic vitality of U.S. counties. It factors in the county’s median household income, unemployment rate, life expectancy, poverty rate, household vacancy rate, and the age 25 to 54 employment-population ratio. Blue counties have the most vitality and orange have the least, while counties that are darker shades of a color have larger populations. Several of the most prosperous counties are on the coasts, but there are also many less-populated, prosperous counties in the Midwest and Mountain regions of the country.

This figure aligns with what a lot of people already know—big coastal cities are wealthy places with plenty of employment options. Other places are doing well too, but even the prosperous counties in the Midwest, Mountain, and South regions are generally part of relatively large metro areas—e.g. the counties around Chicago, Indianapolis, Atlanta, Dallas, and Denver.

In the past people tended to move from low-vitality places to high-vitality places, but since about 1980 such migration has waned. This slow down wouldn’t be a big deal if it was the result of low-vitality areas catching up to high-vitality areas, but that doesn’t seem to be the case. The figure below shows the average vitality for each U.S. region in 1980 and 2016.

In most regions the bars are similar heights, meaning economic vitality in the region in 1980 was similar to vitality today. The only region that flipped from above average to below average is the Great Lakes. In general, a low-vitality county in 1980 is likely a low-vitality county today.

The lack of economic progress in parts of the country coupled with the decline in migration to more prosperous areas is worrying. Many people believe globalization and free trade, along with immigration, are largely responsible for the economic struggles of the low-vitality counties. If something doesn’t change, we’ll continue to hear vocal calls for tariffs and immigration restrictions from people who aren’t well-served by their local economies—and both of these policies will make America poorer in the long-run.

However, many of the most common “place-based” policies enacted to revitalize struggling areas are regularly unsuccessful. Enterprise zones, for example, often have no effect on overall local employment. Other targeted tax incentives also have little to no effect on economic outcomes, and in many cases the investment that does take place would still have taken place absent the tax incentive.

In light of the ineffectiveness of common place-based policies, economists Shawn Kantor, Jason Baron (my colleagues at Florida State), and Alexander Whalley propose leveraging the knowledge generated at research universities to improve the productivity and competitiveness of firms in struggling areas.

The knowledge and skills of an area’s workforce—what economists call human capital—is one of the best predictors of an area’s economic prosperity. Educational attainment is often used as a proxy for human capital, and the figure below shows the relationship between a county’s share of adults with at least a bachelor’s degree and its per capita income (excluding workers in the education sector). It’s clear that income is higher in more-educated counties.

education and incomeBaron et al. Extending the Reach of Research Universities. Brookings (2018)

But this doesn’t mean we can kick start economic growth in struggling counties simply by building colleges there. For a variety of reasons, college graduates are attracted to places with a lot of other college graduates—one key motivation being better job opportunities. College graduates also tend to be more mobile than less-educated people. As a result, even if struggling counties built universities from scratch, most of the subsequent graduates would leave for more prosperous areas.

The authors point to the case of the University of California, Merced, which opened in 2005, as evidence that new research universities are not a panacea. The university was built in a relatively rural, less-prosperous area of California, but so far it has not generated the robust economic activity often attributed to large research universities.

This is not surprising. As the authors point out, the economic benefits of a research university are localized and, crucially, depend on the presence of nearby firms capable of making good use out of the research and graduates the university generates. Without a critical mass of nearby firms, a symbiotic relationship between the university and private sector won’t occur.

Instead of creating a cluster of relevant firms and a research university from scratch—an expensive and daunting challenge—the authors propose extending the Manufacturing Extension Partnership (MEP). The MEP is a program under the U.S. Department of Commerce with centers in all 50 states and Puerto Rico. Each center is a public-private partnership that works directly with universities and local manufacturing firms to spread cutting-edge knowledge that can boost productivity.

While there are some current MEP success stories, the authors suggest that any expansion should be closely monitored to ensure that it’s working. Without proper recurring program evaluation, government programs often end up using resources inefficiently, meaning fewer people get help.

Whether MEP expansion can be an effective place-based policy remains to be seen. Government programs that sound good on paper often disappoint in practice. That said, if rigorous program evaluation is put in place and adhered to, expanding the program may be worth a shot.

Adam A. Millsap is the Assistant Director of the L. Charles Hilton Jr. Center at Florida State University and an Affiliated Scholar at the Mercatus Center at George Mason University.

I am the Assistant Director of the L. Charles Hilton Jr. Center for the Study of Economic Prosperity and Individual Opportunity at Florida State University and a Senior Affiliated Scholar at the Mercatus Center at George Mason University. I conduct research on urban develop...